Insolvency and Restructuring Law in Canada

Canada and the United States are each other's largest trading partners. The rate of investment by Canadian companies in the United States and American companies in Canada continues to grow. With economies that are joined at the hip, financial downturns in one jurisdiction or the other impact stakeholders in both jurisdictions.

While there are many similarities between the Canadian and American systems, there are some material differences in approach and process that must be appreciated in order to understand the Canadian insolvency and restructuring landscape. In certain cases the same words (for example, debtor in possession (DIP) financing) may have quite different meanings or nuances. This paper is intended as a primer to assist American readers in understanding the general principles of Canadian insolvency and restructuring laws.